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Amarin or Novavax: Which Will Report Faster EPS Growth?

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The market opportunity for Amarin and Novavax

In its investor presentation, Amarin (AMRN) highlighted the annual death toll attributable to cardiovascular disease in the United States to more than 800,000 while the yearly treatment cost is estimated at $555 billion. The company further expects these costs to increase 100% in the next 20 years. Amarin has forecast the number of patients on statin therapy in the United States to be close to 38 million.

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According to the company’s investor presentation, controlling LDL-C levels only eliminates 25%–35% of cardiovascular risk. So there’s significant unmet demand associated with the remaining 65%–755% residual cardiovascular risk. Based on results from the REDUCE-IT trial, Amarin expects to position Vascepa as a new treatment paradigm in the cardiovascular space.

In its investor presentation, Novavax (NVAX) highlighted RSV (respiratory syncytial virus) infections in infants as one of the largest areas of unmet demand in the vaccine space. The company is currently evaluating an RSV F vaccine, ResVax, for infants via maternal immunization. It expects ResVax to be a peak market opportunity worth $1.5 billion.

Wall Street’s projections

Wall Street analysts have projected Amarin’s non-GAAP EPS at -$0.35, -$0.13, and $0.27, for fiscal 2018, fiscal 2019, and fiscal 2020, respectively, which implies a year-over-year change of -39.6%, 62.5%, and 309.9%, respectively.

In contrast, Wall Street analysts have projected Novavax’s non-GAAP EPS at -$0.51, -$0.45, and -$0.35, for fiscal 2018, fiscal 2019, and fiscal 2020, respectively, which implies a year-over-year change of 18.8%, 11.7%, and 21.3%, respectively.

Amarin is expected to become profitable by 2020.

Next in this series, we’ll discuss expense projections for Amarin and Novavax in fiscal 2019.

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